Field formations are informed that from this Month onwards : 1) DDM-CUS-1 has been modified with new column i.e 'IGST-REFUND' and this is to be uploaded since the Month of July-2017 onwards. 2) DDM-ST-1 has been restarted,so field formations are requested to upload the data since the Month of July-2017 onwards. 3) DRI-CUS-7 has been modified with new group i.e 'Recovery by way of disposal of goods' which is to be uploaded from the current Month ,i.e, Jan-2018.

ATTN: BUDGET UPDATE :On account of Budget 2018-2019, due to be presented on "1-Feb-2018", filing of B.E.'s would not be available from 1700 hrs onwards on "1-Feb-2018" till completion of updation of all changes in the ICES 1.5

Section 11 of the Customs
Act,1962 provides that the Central Government may, by issuance
of notification in the official Gazette, prohibit either
absolutely or subject to such conditions as may be specified,
import or export of goods for the purposes specified in
sub-section (2) of section 11 of the Customs Act, 1962. The
Central Government may restrict or prohibit import and export of
goods infringing trademarks, patents and copyrights under clause
(n) of subsection (2) of section 11 of the Customs Act, 1962.
Similarly, the Central Government may restrict import and export
of goods for the purpose of prevention of the contravention of
any law for the time being in force, under clause (u) of
subsection (2) of section 11 of the Customs Act, 1962.

3 Representations were
received from the trade for issuance of a notification to
prohibit import of goods infringing other IPR laws as well.
Further, considering our obligation to implement border measures
as envisaged in Articles 51 to 60 of the WTO Treaty on Trade
Related Aspects of Intellectual Property Rights (TRIPS), a need
was felt to define the role of Customs precisely in combating IPR
infringements at the borders. Accordingly, notification No
49/2007-Customs dated 8-5-2007 has been issued,
which prohibits import of goods infringing
intellectual property rights of the right holders under The
Copyright Act, 1957, the Trade Marks Act,1999, the Patents Act,
1970, the Designs Act, 2000 and the Geographical
Indications of Goods (Registration and Protection) Act, 1999.
Besides, the procedure for registration of a notice with the
Customs by right holders and the conditions for such
registration, etc. have been laid down in the Intellectual
Property Rights (Imported Goods) Enforcement Rules, 2007 notified
under notification 47/2007-Customs (NT) dated the 8th
May,2007 (hereinafter referred to as the said Rules). The
said Rules lay down a detailed procedure to be followed by the
right holders or their authorized representatives as also by the
Customs for seeking suspension of release of suspect imported
goods.

4. It is pertinent to mention
that while the mandatory obligations under Articles
51 to 60 of the TRIPS dealing with border measures are restricted
to Copyright and Trade Marks infringement only, the said Rules
deal with Patents, Designs and Geographical Indications
violations as well, in conformity with the practice prevailing in
some other countries, notably EU countries. While it is not
difficult for Customs officers to determine Copyright and Trade
Marks infringements at the border based on available data/inputs,
it may not be so in the case of the other three violations,
unless the offences have already been established by a judicial
pronouncement in India and the Customs is called upon or required
to merely implement such order. In other words, extreme caution
needs to be exercised at the time of determination of
infringement of these three intellectual property rights.

The said Rules, inter alia, provide
for

(i)
the filing of a notice by the right holder;

(ii)
registration of said notice by the Customs;

(iii)
a time limit for right holders to join proceedings;

(iv)
a single point for registration of the notice filed
by the right holder;

(v)
adequate protection to the rightful importer;

(vi)
adequate protection to the Customs for bonafide act;

(vii)
suo-moto action by the Customs in specified
circumstances;

(viii)
disposal of the confiscated goods.

(ix)
no action against goods of non commercial nature
contained in personal baggage or sent in small
consignments intended for personal use of the
importer.

5. The right holders
would be required to give a notice for registration
in the manner detailed in para 10 of this circular
, to any one of the Commissioners of Customs at
the ports where counterfeit goods are likely to be imported
infringing the IPR in respect of any trademark, copyright,
patent, design or geographical indication. The grant of
registration by Customs is subject
to the execution of a bond, along with surety and security
by the right holder or his authorized representative
in terms of Rule 5(a), undertaking to protect the
importer, consignee, the owner of the goods and the competent
authorities against all liabilities and to bear the costs
towards destruction, demurrage and detention charges
incurred till the time of destruction or the disposal
of the infringing goods. The registration is also subject
to execution of an indemnity bond by the right holder in terms of
Rule 5(b), indemnifying the Customs authorities against all
liabilities and expenses on account of suspension of the release
of allegedly infringing goods.

6. At the time of
registration but prior to importation, it may be difficult to fix
the bond amount corresponding to the value of
suspected infringing goods not yet imported. Further, this would
lock in right holders' money in the form of security. Therefore,
it has been decided that, the right holders may
furnish a General Bond without security
to the Commissioner of Customs in the format as
prescribed at Annexure-A to this circular prior to the
grant of registration, undertaking to execute the
Bonds with the jurisdictional Commissioner of Customs at the port
of interdiction as per the format specified
under Annexure-B and Annexure-C within three days from the
date of interdiction of any allegedly infringing imported
consignment . Prior to grant of registration, the right holder
shall also be required to furnish an indemnity bond under Rule
5(b) in the format as specified at Annexure-C to this circular,
in addition to the General bond. Thus, the registration would be
subject to execution of the General Bond as specified at
Annexure-A and indemnity bond as specified at Annexure-C. The
specimens for consignment-specific Bond to be executed in terms
of Rule 5(a) and the indemnity bond to be executed in terms of
Rule 5(b) are enclosed for guidance at Annexure-B and Annexure-C
respectively. Necessary amendments may be made to suit the
requirements, on case to case basis.

7. The surety and security shall be on
consignment basis and shall be furnished along with the bond
(Annexure B) consequent upon interdiction of the
consignment allegedly infringing rights of the right
holder. Keeping in view the value of the goods and other
incidental expenses, it has been decided that the bond amount
shall be equal to 110% of the value of goods. However,
the amount of security to be furnished along with the bond shall
be 25% of the bond value. The right holder may furnish security
in the form of bank guarantee or fixed deposit. However, if the
right holder fails to execute the consignment specific bond and
to furnish security within three days from the date
of interdiction of the goods, the same must be released
forthwith.

8. In case
it is found at any stage that the right holder furnished wrong or
false information, the registration accorded under Rule 4 of the
said Rules may be cancelled forthwith.

9. If , after the
registration is granted , the right holder wants any
modification on account of any amendment in
registration granted to them by the respective
registry of the departments enforcing the
parent IPR law or on account of any other
reason, the right holder shall be required to seek fresh
registration in place of the old registration
and shall be required to undergo all the
processes of registration again, like making fresh
application, payment of fees, execution of bond etc.

10. The said Rules provide that notice would be given by
the right holders in the format prescribed in the Annexure to
the Rules. However, as a trade facilitation measure
enabling right holders to file the notice electronically, a user
friendly web- enabled application form is being devised.
The right holders would be required to log into http://www.icegate.gov.in.
Thereafter, they can choose the Custom House where they wish to
record their notice, from among the ports of
importation of the suspected infringing
goods. Option has been provided to separately register
different IPR's viz., Copyrights, Trade Marks,
Patents, Designs and Geographical Indications. As regards payment
of registration fees, option has been given to the applicants
either to use on-line credit card mode of payment or the
conventional mode of Demand Drafts, drawn in favour of
Commissioner of Customs of the Custom House where they wish to
get their notice registered. For
every separate right, the right holder shall be required to
submit a separate notice (application). After completing the
formalities on-line, the application can be "submitted" on the
website. A Unique Temporary Registration Number (UTRN) will be
generated by the System. The System would also prompt the
applicant to take a print- out of the application. This printed
application form, along with the Demand Draft and physical copies
of Bond and indemnity Bond (as prescribed under Rule 5 of the
said Rules) and as detailed above, would be required to be
submitted to the Commissioner of Customs along with samples,
models or photographs.

11. After the receipt of the application,
the Commissioner of Customs shall verify the veracity of
declarations made therein. If required, cross-verification of
particulars furnished may be carried out with the concerned
authorities with whom the rights are registered in
accordance with the parent enactments. The Commissioner may call
for any additional information from the applicant(s). After
verification of the application, the Bond (general) and the
indemnity bond as required under the said Rules, the particulars
would be required to be entered in the CBEC web-site duly
furnishing the details. The System would then automatically
generate a Unique Permanent Registration Number (UPRN), which
will be communicated to the applicant for all future
correspondence. Simultaneously, a formal communication to this
effect shall be sent, within 24 hours, to the Risk Management
Division (RMD), Mumbai and all other Custom Houses, who can
access the details through the user names and pass-words given to
them. On the contrary, if the Commissioner or his authorized
officer of Customs has to reject the application leading to
denial of protection, principles of natural justice may be
followed. It may be noted that the temporary registration
number granted by the System does not accord any protection to
the right holders. The temporary registration is only an
acknowledgment of the application filed by the right holders and
cannot be taken as actionable. The registration will be granted
only after the Commissioner of Customs
has completed verification of thedocuments and facts and after the right holder has
furnished the General Bond and Indemnity Bond. The protection of
rights will be accorded only on grant of a permanent registration
number to the right holders.

12. To begin with, while the
web-enabled electronic registration system is being put in place,
the field Commissioners are advised to accept the applications in
the format as prescribed in the Annexure to the said Rules.
However, in order to have a centralized registration , it
will be mandatory for all applicants to file applications
on-line, once the system is geared up for accepting electronic
on-line registration. The trade will be intimated the date of
coming into force of the electronic regime.

13. It may be noted that though the
notice/application for registration may be submitted to
the Commissioner of Customs at any of the ports
where counterfeit goods are likely to be imported infringing the
IPR in respect of any trademark, copyright, patent, design or
geographical indication and all formalities associated with the
registration are undertaken by that Commissioner, protection will
be accorded at all the ports as specified in the notice.
Therefore, there is no apparent need for the right holders to
make several notices/applications with all the Commissioners of
Customs covered under the notice. It may be
emphasized that for protection of separate rights under any IPR
law, the right holder would be required to apply for separate
registration for each such right.

14. In case of suspension of clearance
of goods by Customs on its own initiative, the right
holder is required to give notice as laid down under rule 3
of the said Rules and to execute the
Bonds as specified in rule 5 of the
said Rules within five days from the date of suspension of
clearance. The procedure of registration would be as stated
in the foregoing paragraphs. However, the right holder would be
required to execute a Bond in the format as specified in
Annexure-B along with security and the indemnity Bond in the
format as specified in Annexure-C, prior to grant of registration.

15. Rule 4(2) provides that registration
may be granted for a minimum period of one year unless the right
holder wants the same for a lesser period. It has been decided
that the period of validity of the registration under the said
Rules would be 5 years. The Commissioners, therefore, may keep a
watch on the expiry of this period. Once the period of validity
of registration has lapsed,,t the right holder would be required
to furnish fresh notice, pay the fees as applicable,
execute general Bond etc as done at the time of
initial registration.

16. It may be appreciated that
systematic enforcement of IPRs is new to Customs. Further,
the nature of implementation of IPR regime is different in EDI
and non-EDI locations. Besides, RMS has not been
implemented in all EDI locations. It may be noted that
while national-level targeting of consignments can be handled by
RMD, Mumbai on the basis of the information furnished by the
applicants, and, under normal circumstances, consignments
suspended by the national targets will be sent with appropriate
instructions to the officers to handle the suspect consignments,
any intelligence driven interdictions on the own initiative of
officers cannot be discouraged. However, such ex-officio
intervention by officers needs to be regulated and exercised with
utmost caution, given the fact that the liability for wrong
detention in an ex-officio case would rest entirely with the
department. In EDI locations where RMS is not implemented, all
the consignments are necessarily assessed before clearance.
Therefore, officers in Groups and Sheds at such locations may be
sensitized about the IPR registration database so that they can
keep a watch on suspect imports. Apropos, the non-EDI locations,
where officers do not have access to the "icegate", copies of the
applications along with the accompanying documents shall be sent
without delay by the Commissioners who are handling the
registration of Rights to such locations by e-mail or by speed
post.

17. It may be noted that the terms
and the phrases used in the notification and the Rules made in
terms of section 11, have the meanings, with all grammatical
variations and cognate expressions, assigned to them in the
respective parent enactments like The Copyright Act, 1957, The
Trade Marks Act, 1999, The Patents Act, 1970, The Designs Act,
2000 and The Geographical Indications Act, 1999. Thus, it
may be emphasized that determination of the fact whether a
particular consignment infringes the rights of the right holder
would be done taking into account the provisions of the parent
acts.

18. It is important to adhere to
the time lines prescribed in Rule 7. The Customs and the right
owners/holders seeking protection are under obligation to follow
the time lines indicated in various sub-rules that cover
practical situations that may arise in the field. Since every
suspension of clearance has its concomitant legal implications,
the trade as well as field officers dealing with the infringing
goods, may be adequately sensitized about the importance of
timely action.

19. Sub-rule
(9) of Rule 7 of the said Rules, provides for seizure of
infringing goods, if there are reasons to believe that the goods
are liable to confiscation in terms of section 111 of the Customs
Act, 1962. In this context, it may please be borne in mind that
Customs is enforcing laws in personam while protecting
intellectual property rights. Thus it is important to make sure
that the right holder participates in the Customs proceedings. In
case the right holder abstains, the Customs have no obligation to
continue with the detention and the goods shall be released
forthwith, if otherwise in order.

20. Rule 8 enables examination of
goods and drawal of samples on the request of right holders or
importers. The regular procedure for sampling may be followed.
Representative samples must be kept in the safe
custody of Customs till the proceedings are
concluded. The expenses involved in sampling, testing of samples
etc have to borne by the right holders.

21. For smooth implementation of the IPR regime, it
is desirable that an IPR Cell may be constituted in each
Custom House. The IPR Cell may be vested with the responsibility
of verifying the applications, completing web-enabled
registration formalities and making correspondence with the Risk
Management Division and other Customs formations. Further, any
import involving suspected infringement of IPRs may have to be
invariably handled by the IPR Cell. Any instance of suo-moto
interdiction of the import consignments by the Customs, involving
possible infringements, should also be referred to such IPR Cell.
The job is time - bound and sensitive and hence it is advised
that officers of proven calibre may only be posted in the IPR
Cells.

22. Wide publicity to this
Circular may be given by way of issuance of public notice and
standing order.

23. Difficulties , if any, faced in the
implementation of this circular, may be immediately brought to
the notice of the Board.